After Nicolet National Bank announced last fall it was buying Mid-Wisconsin Bank in Medford for $10.2 million, the Green Bay-based financial institution decided to make another purchase in Medford as well - a 2,500-square-foot, $300,000 house.

On the last weekend in April, as Mid-Wisconsin branches and computers were being converted to Nicolet's system, Nicolet Chief Executive Bob Atwell found himself in the kitchen of that house preparing ham-and-egg breakfast sandwiches for Nicolet staffers who had stayed overnight before they headed out to branches in Neillsville, Rhinelander and elsewhere.

In the evening, Nicolet staff members returned to the house to talk about how the day went.

"It's base camp," Atwell said.

Nicolet eventually plans to sell the house and recoup the $300,000, essentially making all those nights spent there free compared with hotel rooms the bank would have needed.

Nicolet has been expanding since it was founded by former Associated Bank lenders Atwell and Mike Daniels 13 years ago. So it wouldn't be surprising if Nicolet sets up a future acquisition base camp in a house somewhere else in the northern two-thirds of Wisconsin.

"We've always been a growth story," Atwell said. "We are interested in strategic growth in this environment."

Well-capitalized today and profitable even throughout the economic downturn, Nicolet has put itself in position to become a bigger presence in the state.

"Only time will tell. But they're good, smart bankers," said George Reis, president of GVR Investment Management in Two Rivers.

Nicolet was started in 2000 by Atwell and Daniels. One goal was to build into their start-up bank a culture of high-level service and personalized business relationships with customers, many of them owners of companies in the area.

The strategy appears to have worked. Nicolet quickly has risen to become third in deposit market share in its hometown Green Bay area. The merger with Mid-Wisconsin puts Nicolet at more than $1 billion in assets, making it one of the 15 largest banks based in the state.

Absorbing Mid-Wisconsin

Atwell said now that the acquisition of Mid-Wisconsin, a bank hit hard by the recession and subsequent slow economy, has taken place, the next step is establishing Nicolet's culture in Mid-Wisconsin and its 11 branches. That might take some time, he said.

"The (Mid-Wisconsin) staff's been kind of beaten up and confused, and morale was struggling," Atwell said. "You need to get people in there to put some new energy in and teach people there's a right way to do this and you can be winners."

It also will take some time to resolve legacy loan problems from Mid-Wisconsin's portfolio, he said.

The deal came about after Mid-Wisconsin Financial Services Inc., the parent company of Mid-Wisconsin, contacted Nicolet about a takeover. Nicolet had made it known it was looking to expand.

"They identified us as people they really thought might be able to provide a recovery of value and provide the leadership that's needed," Atwell said.

Mid-Wisconsin's territory - north-central Wisconsin - wasn't the first place Nicolet was looking to expand, Atwell said. The bank has been eyeing growth in Appleton, where it already has a presence.

"We think that Appleton is a market that doesn't have a clear community bank leader, and we want to be that," Atwell said.

But when the Mid-Wisconsin opportunity came along - at a relatively low price because of its struggles - Nicolet found it liked the bank's markets, core deposits and the entrepreneurial, small-business banking relationships it had with customers.

"It's a geographic stretch for us," Atwell said. "On the other hand, it's a very charming part of the state. It's very Wisconsin. People aren't Vikings fans yet - you've got to get farther west before you run into that."

No plans for IPO

Mid-Wisconsin was a publicly traded company, and along with the bank, Nicolet got its own stock ticker symbol - NCBS, short for Nicolet Bankshares Inc. - in the deal as it became a registrant of the Securities and Exchange Commission.

Its shares haven't traded yet on an exchange, but probably will in the future as current shareholders seek to sell or buy. With the acquisition, Nicolet now has about 800 shareholders.

Investors shouldn't hold their breath waiting for an initial public offering of Nicolet stock, however.

"At this point, we really don't need capital. For us to have an IPO, we'd have to have some need for it," he said.

The acquisition of Mid-Wisconsin puts total Nicolet employment at about 325, and leaves lots of space between its headquarters in Green Bay and its new west-of-Wausau branches. That space might be filled in with other acquisitions or branches in the future.

For now, Atwell said, his bank is concentrating on successfully blending Mid-Wisconsin into Nicolet's ways.

"Installation of the culture is the key," Atwell said. "You can have great economics to the transaction, which this does, but systems integration and the cultural integration is the key to execution."